....coming May 1st 2008
Marketing strategy entails an organization doing 5 key things.
Air Canada example
If you are entrepreneur this article is for you.
In an interview with Wharton, two Latin American entrepreneurs and writers reveal what I succinctly believe you need to do to make your business a success.
UK@W: What steps does an entrepreneur have to take from the time he or she gets the idea until the time when it is put into practice? Is there a trick for speeding up the process?
H.H./D.B.: The first step is to show in practice that the idea is viable. That means that you have to create a prototype of the business – an action plan that you carry out. The business model will be valid only if it produces sales in the volume and at the speed that you forecast. In this respect, you have to be as creative as possible; your tests must involve conditions that are as close to reality as possible. Some people will say, “For my business idea, it isn’t possible to create a prototype.” We think that is just an excuse. There is always a way to create a prototype and sell it.
In the United States , an entrepreneur wanted to build a spa that would provide hydrotherapy. It was hard for him to create a prototype in that area, but he could create a business model. So he invested in virtual models and rented space in a shopping center. His goal was to get 1,000 members to subscribe by asking them for a symbolic registration fee. The club needed at least 200 members to be profitable, and they knew that if they signed up 1,000 people, it was more likely that once the project was launched, only 500 people would pay their fee. If there hadn’t been 1,000 subscribers, the entrepreneur would have returned the fees to the people who had paid them. If it had more than 1,000 subscribers, it would be clear that all of its investments were justified. The principal was clear: An economy of resources, economy of efforts and the minimization of risks.
In that example, would it have been worth the trouble to go through every step and make all the investments, only to realize that the business plan would work? When a model is validated through a prototype, the costs of registration and financing and all the other costs that you need will be much easier to get. So you should never risk what you don’t have without having proved the validity of your business model.
